Neeco Profit Falls By 30 p.c.

Press, Volume CVI, Issue 31115, 19 July 1966, Page 21

Neeco Profit Falls By 30 p.c.

Losses incurred by the range factory at Kaiwharawhara and by the New Zealand Insulators, Ltd., factory at Temuka were partly responsible for the 29.9 per cent fall in the profit of the National Electrical and Engineering Company, Wellington, in the year to March 31, the directors report.

In addition, the group met non-recurring expenses totalling £13,693 in relation to the debenture issue and in moving the Auckland warehouse from the city to Ellerslie. The directors announce the purchase from Dominion Motors of the Beatty washing machine factory at Kaiwharawhara. The settlement was partly in cash and partly by the issue of 169,697 5s shares. The premium on these shares totalled £27,576. The directors state that the subsidiaries Neeco Wholesalers, Ltd., and Speedway Products, again produced satisfactory profits during the year. Corrective measures have been taken at the Kaiwharawhara and Temuka factories. Although it caused interruption in selling for several months, the move to Ellerslie is producing improved results. The full accounts confirm consolidated net profit at £74,984, a fall of £32,058. In addition, a profit of £74,931 from the sale of the Neeco Wholesalers property in Auckland has been transferred to reserve. The net result was struck after providing £29,050 less for tax at £74,980 but £2124 more for depreciation at £48,195. As announced, the dividend is steady at 6 per cent, requiring £53,821 against £51,275. The carry-forward is increased from £285,688 to £307,053.

The consolidated balancesheet reflects the Beatty acquisition and the property sale, shareholders’ funds being £166,296 higher at £1,474,002. Paid capital is up from £854,588 to £897,012 and capital reserve from £62,889 to £114,821. On the enlarged total of funds the lower profit gives an earning rate of 5.1 per cent, against 8.2 per cent previously. After the debenture issue, term liabilities are up from £73,318 to £367,277. Current liabilities are reduced from £888,870 to £656,979.